In a news conference, the Turkish Minister of Finance Mehmet Simsek announced that the government is cancelling the US$5.7 billion for its toll roads and bridges privatization project. The decision was reached after Prime Minister Tayyip Erdogan said that the tender results were well below the expected returns.
The tender was first won by the consortium consisting of Koc Holdings and Gozde Girisim of Turkey together with the UEM Group Berhad of Malaysia. The ripple effect of the announcement was not known as the Istanbul Stock Exchange was closed when the Finance Minister issued the cancellation.
The project was one of the country's biggest privatization deals, covering a 2,000 km stretch of the Edime-Istanbul-Ankara highway and with it two of the largest bridges in the country. The project would have given the consortium 25 years to operate and maintain the roadways.
The Prime Minister backtracked on the promise that highways and bridges would remain in the state's hands but the current program of privatization is needed to shed the government of non-performing assets and expenses.
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